Question to the Department for Levelling Up, Housing & Communities:

To ask Her Majesty's Government what plans they have to suspend repossession of leasehold properties until potentially dangerous cladding in such properties has been replaced.

The Government has announced a globally unprecedented investment in building safety and hundreds of thousands of leaseholders will be protected from the cost of replacing unsafe cladding on their homes.

On 10 February the Government announced it will provide an additional £3.5 billion grant funding for removal of unsafe cladding on buildings over 18 metres, which brings the total investment in building safety to an unprecedented £5 billion.

Lower-rise buildings between 11 and 18 metres, with a lower risk to safety, will gain new protection from the costs of cladding removal through a generous new financing scheme. As part of this financing scheme, no leaseholder will pay more than £50 per month towards the cost of cladding remediation.

This builds on steps already taken to support leaseholders, including £1.6 billion of funding to remediate unsafe cladding, the £30 million waking watch fund to help end excessive costs and new legislation in the Building Safety Bill which will ensure homes are made and kept safer in future.

The schemes will be launched in due course, and we will publish more details on how these will work as soon as we are in a position to do so.

The Government has worked with the lending industry and the regulators to prevent both homeowners and landlords from facing unaffordable bills or repossession if they can’t work, or if their tenants can’t pay rent due to the impact of coronavirus.

Mortgage holidays have been extended, with applications open to 31 March 2021. Borrowers that have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six-month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.  Current FCA guidance states all mortgage holidays must end by 31 July, so while no one can have more than a six-month deferral, any consumer applying now for their first payment holiday will not be able to take the full six months. Information on mortgage payment holidays is set out on the FCA website: https://www.fca.org.uk/news/press-releases/fca-confirms-support-mortgage-borrowers-impacted-coronavirus

The FCA has been clear that for borrowers who have taken six months’ holiday and continue to face ongoing financial difficulties, firms should continue to provide support through tailored forbearance options. This could include granting new mortgage payment holidays. Mortgage customers in this situation should speak to their lender to discuss their options.

A mortgage holiday is not the right solution for everyone, and a prolonged payment deferral may not be in a consumer’s best interest - it is important to remember that whilst someone takes a payment holiday, they will still owe the amount they don’t pay during the deferral period, and interest will continue to accrue. Where consumers can afford to re-start mortgage payments, it is in their best interest to do so.